Rajasekaran Nithiyanandhamm v. Principal Commissioner Of Income Tax-1, Thane & Ors. …

IN THE HIGH COURT OF JUDICATURE AT BOMBAYCIVIL APPELLATE JURISDICTIONWRIT PETITION NO. 4108 OF 2022 Rajasekaran Nithiyanandhamm … Petitioner VersusPrincipal Commissioner of Income Tax-1, Thane& Ors.… Respondents Mr. Dharan Gandhi with Ms. Aanchal Vyas for Petitioner.Mr. Ajeet Manwani with Ms. Samiksha Kanani, for Respondent. P.C. : CORAMK. R. SHRIRAM &DR. N. K. GOKHALE, JJ.DATED:28th August 2023 1.Petitioner is an individual, who used to work with thecompany by name M/s. Dow Agrosciences India Private Limited.He used to get annual taxable salary income of Rs.63,33,732/- onwhich tax of Rs.15,36,924/- was deducted at source. Employer ofPetitioner also took into account various exemptions andallowances under Section 10 of the Income-tax Act, 1961 ("Act"),profession tax, loss from the house property, etc. 2.For the Assessment Year 2017-18,Petitioner filed return ofincome on 29th July 2017 declaring total income ofRs.63,33,732/- and claimed refund of Rs.15,36,924/-. Return wasprocessed by Centralised Processing Centre ("CPC") on 25th March2019 determining a demand of Rs.2,17,670/-. 3.Petitioner filed a revision application under Section 264 ofthe Act on 21st January 2020 for revision of intimation underSection 143(1) of the Act. In the application, Petitioner hasclaimed that the CPC, while processing the return, has notconsidered deduction for allowances exempted under Section 10 ofthe Act amounting to Rs.1,83,995/-, interest on housing loan anddeduction under Chapter VIA.Petitioner also mentioned thatincome of Rs.1,29,220/- under the income from other sources hasbeen taxed but the TDS deducted on interest income amounting toRs.12,922/- has not been considered. 4.Assessing Officer was directed to submit his report aftertaking into consideration correctness of the contentions of theassessee. Assessing Officer submitted a report in which AssessingOfficer has stated that before processing of return on 25th March 2019, the Assessee was sent one defective letter dated 7th June2018 under Section 139(9) of the Act to which "Apparently"Assessee did not respond. The Assessing Officer has also submittedthat mistake was totally attributable to the Assessee and he hasmade no sincere efforts to rectify the mistakes within availabletime though ample reminders were sent.Other than baldstatement, we do not find any detail. It is also stated in theimpugned order that thereafter notice was issued to assessee on20th March 2021 providing an opportunity to put forth his case,which was not availed by Assessee and hence, decision was madeon the basis of facts and materials on record. Paragraph 6 of theimpugned order says "Considering the above mentioned facts,petition of Assessee, submissions made by Assessee and report ofthe Assessing Officer, I find that assessee's contention is notacceptable." Based on this, application of assessee has beenrejected. 5.Having considered pleadings and hearing the counsel, wefind that there is no record to indicate any notice under Section139(9) of the Act was sent. In any event, Section 139(9) of the Actprovides that if the defect is intimated to the Assessee and the defect is not rectified within time provided, notwithstandinganything contained in any provision of the Act, the return shall betreated as invalid return and the provisions of the Act shall applyto the Assessee as if the Assessee failed to file return. Admittedly,return has been processed under Section 143(1) of the Act becausein paragraph 3 of the impugned order itself it is mentioned"............ it is seen that before processing of return on 25th March2019.....". Therefore, even assuming a defect intimation dated 7thJune 2018 had been issued under Section 139(9) of the Act, wehave to proceed on the basis that defect has been rectified. defect is not rectified within time provided, notwithstandinganything contained in any provision of the Act, the return shall betreated as invalid return and the provisions of the Act shall applyto the Assessee as if the Assessee failed to file return. Admittedly,return has been processed under Section 143(1) of the Act becausein paragraph 3 of the impugned order itself it is mentioned"............ it is seen that before processing of return on 25th March2019.....". Therefore, even assuming a defect intimation dated 7thJune 2018 had been issued under Section 139(9) of the Act, wehave to proceed on the basis that defect has been rectified. 6.Next point is regarding the notice of personal hearing givenon 20th March 2021 by Respondent No.1. The notice has beendigitally signed on 20th March 2021 at 2.51 pm, a Saturday. Thehearing is fixed at 11.30 a.m. on 23rd March 2021, Tuesday.Therefore, effectively only one working day notice has been given.There is no explanation as to why such a short notice was givenand we could only assume that Respondent No.2 in the last minuterealised. Limitation was expiring on 31st March 2021. TheRevision Application admittedly was filed on 21st January 2020and Respondent No.1 sat over the file for more than 14 months. Digitallysigned bySHAMBHAVISHAMBHAVINILESHNILESHSHIVGANSHIVGANDate:2023.08.3113:14:45+0530 We have to also note that it was the time when the secondPandemic of Covid was at its peak. It is also averred in the Petitionthat Petitioner had joined another company M/s. Atul Limited on4th July 2019 and e-mail of the notice for hearing was sent to theemail id that Petitioner has disclosed of his earlier company, i.e.,M/ . 7.Therefore, we hereby quash and set aside the impugnedorder dated 26th March, 2021 and remand the matter toRespondent No.1 for de-novo consideration. Application shall be disposed within eight weeks. Before passing any order, Respondent No.1 shall givepersonal hearing to Petitioner notice whereof shall becommunicated at least five working days in advance. Order to be passed shall be order on merits on Petitioner'sclaims in the application dealing with all submissions of Petitioner. (DR. N. K. GOKHALE, J.)(K. R. SHRIRAM, J.)